Cellcom Israel CEO to resign as chairman steps up into enhanced role
Cellcom Israel has announced that Nir Sztern, the company’s CEO is to resign.
Confirmed to the company’s board of directors his intention to leave the position at some point in the near future, although an exact time frame hasn’t been given.
As a result, the board of directors has nominated a committee to oversee the process for finding and assigning a new CEO. According to Globes, Sztern is to replace Yona Fogel as CEO of Paz Oil Company.
In addition, the board of directors reaffirmed its continued commitment to the company's previously announced restructuring plan announcing that the company's chairman of the board, Ami Erel, will actively manage the CEO transition, as well as provide executive oversight of the execution of the company's operations and its restructuring plan during the transition period.
Announced in September, the restructuring is set to ‘strengthen the company in facing the continued intense competition and low prices in the Israeli telecommunications market’ it said at the time.
The plan seeks to meet the following three targets. Firstly, to return to positive net income. Second to reduce the company’s net debt to EBITDA and lastly to prepare the company to better cope with market conditions, intense competition and future investments.
As such Cellcom is carrying out the following activities according to the following timescale:
It will cut expenses amounting to approximately NIS 150 million staring immediately. It will do this through broad reduction of expenses and payments to suppliers, substantial reduction in manpower and reduction of landline wholesale access fees.
It will cut investments bringing down its capital expenditure to approximately NIS 450 – 500 million per annum to be fully completed by the end of 2020.
In addition, it will raise capital of approximately NIS 400 million.
It will factor customers' end-user equipment of approximately NIS 100 – 150 million.
Lastly it will reduce debt through open market repurchases of the company's debentures up to NIS 150 million.
"We believe that restructuring the company, in its operational, financial and reduction of Net debt to EBITDA ratio will enable the company to participate in mergers, acquisitions and other opportunities that may present themselves in the telecommunications arena in the next few years," said Erel at the time.